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Toyota 31, Nhtsa 30, Us 7, America 3, Dave Shepardson 3, Ray Lahood 3, U.s. 3, Nasa 3, United States 3, Detroit 2, Washington 2, Clinton 2, North America 2, Stilupak 1, Lahood 1, Mr. Toyoda 1, Robert Gates 1, Dr. Gilbert 1, Dr. Jeffrey Runge 1, Clarence Ditlow 1,
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  CSPAN    [untitled]    [curator: unknown description]  

    April 6, 2010
    8:00 - 8:29pm EDT  

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click it, and share over 1000 -- over 100,000 hours of video -- every c-span videos since 1987. cable's latest gift to america. >> over the next two hours, we're going to take your calls and questions about federal oversight of car safety standards. after that, a briefing on nuclear weapons policy with robert gates and of hillary clinton. later, remarks by the director of national intelligence, dennis blair. >> it is the auto maker's responsibility to make sure they comply with federal safety standards. that is their responsibility. we are not branding these cars safe. it is our job to enforce and to
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please the marketplace -- to police the market place, which we do. the automakers have to uphold their obligation to not only comply with our standards but the state of the art. it is my job to make sure they called to the standards. this agency will hold the line. >> david strickland, head of the nhtsa, testifying before congress in his agency's role in auto safety. the agency follow those words with an announcement that it will seek a fine against toyota of $16 million for failing to notify officials about the sticky pedals on its cars. we will talk about the role of nhtsa with several guests. we will include your phone calls and your twitter messages. we are going to hear from two former safety administration officials, dr. jeffrey runge, who served during the bush administration, and dr. ricardo martinez, who was nhtsa
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administrator for president clinton. in our last hour, we will get the auto industry perspective with dave mccurdy, and end with clarence ditlow. starting as off is dave shepardson of "detroit news." many people saw the headline -- regulators seeking a fine of $16.40 million against toyota. the statement said "if upheld." why does it say that? >> toyota gets to formally denied decide whether it wants to appeal the fine. this is by far the largest ever find that nhtsa has sought to impose. the previous was $1 million against general motors in 2004. the amounts are symbolic, given that these are companies with hundreds of billions of dollars in revenue.
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$16 million is a rounding error for them. >> what happens next? have you heard from toyota? if it goes to court, how long would the process take? >> toyota has two weeks to respond and say they will pay the fine or challenge it. nhtsa has to decide if it is going to uphold the fine. if toyota continues to challenge it, they will go to the district court to get a job to uphold it. that process could take several months if toyota decides to fight it. >> the transportation secretary ray lahood put out a statement saying that toyota failed to live up to its legal obligation. worse, they hid a dangerous defect four months and did not take action to protect millions of drivers and their families. we are seeking the maximum penalty possible under current law. this is unprecedented. is there some history of fines
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against auto companies? >> it was not until 2000 that fines for increased to $15 million. there are going up at the rate of inflation. with the exception of that 2004 find against general motors, $1 million because they failed to notify nhtsa about when chilled wiper defects in 600,000 vehicles -- the evidence suggested that gm had known about this for two years. there have not been a lot of fines because of the companies generally want to recall the vehicles quickly. that is fewer vehicles you have to fix and there is less damage to their reputations. nhtsa needs the cooperation of the auto companies to make the current regulatory system work. >> the transportation secretary also said that nhtsa will continue to review over 70,000 documents on the situation. does that mean there are more fines to come? >> there is a good chance.
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they are looking at three separate recalls. this law is strict. as soon as the company determines the have a safety defect, they have five days to notify nhtsa and recall the vehicles. there is not a lot of time. in the case of toyota, the first recall for sticky, pedals, they allegedly awaited for months or more. there is another recall of 5.4 million vehicles over pedals that got stuck in floor mats, which led to the horrible incident last august where four people were killed in california, which got this issue going. they are looking at a third recall as to timeliness as well. >> you said this probably would not financially cripple toyota, given that they have $200 billion in profits a year. >> in revenue. >> what about its image? if they are find this money and it goes through and they agree
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to pay -- >> that is the whole issue. toyota's image has taken a huge blow. we're talking two or three months of tremendous publicity across the globe. no one could avoid hearing about the issue of sudden acceleration. they have recalled 8.5 million vehicles. they now face over 200 class- action lawsuits over deaths and sudden acceleration issues. some owners want full refunds for their toyotas. others want to be compensated because the value has gone down since this happened. the other issue on the find is that could potentially be used against them to help convince juries and judges that those claims have merit. the 60 million is about the fact that it is another tarnish -- the $16 million is about the fact that it tarnishes a company once had the highest safety reputation. >> what is the company doing to
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win back customers? >> money. they had a great month because we ought to give more incentives to customers than they have ever done. they did not need for years to give incentives for the prius and other vehicles. they hike that to $2,000 a vehicle. that is lower than many competitors, but less -- but more than the past. they have offered free maintenance for two years. the strategy is about convincing core customers not to leave and trying to prod others with great deals. >> how have other companies responded? >> some are adding more incentives. general motors, ford, and others tried to poach toyota customers by saying "premier toyota in. we will give you a good deal." all is fair in love and the car business. >> the toyota president testified in february about the situation. let us listen to a little bit of what he had to say.
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>> toyota has, for the past few years, been expanding business rapidly. i fear the pace at which we have grown may have been too quick. i would like to point out here that our priorities have traditionally been the following. first, safety. second, quality. third, volume. these priorities became confused. we are not able to stop, think, and make improvements as much as we were able to before. our basic stance -- to listen to customer voices and make better products -- has weakened somewhat. we pursued growth and speed at which we were able to develop our people and our organization. we should be mindful of that. i regret that this has resulted
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in the safety issues described in the recall we face today. i am deeply sorry for any accident that toyota drivers have experienced. especially, i would like to extend my condolences to the members the family for the accident in san diego. i would like to send my prayers, and i will do everything in my power to ensure that such a tragedy never happens again. since last june, when i took office, i have personally placed the highest priority on improving quality over quantity. i hope to share that with our stakeholders. as you know, i and the grandson of the founder.
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all the toyota vehicles bear my name. for me, it is as though i am as well. i, more than anyone, which for toyota cars to be safe and for our customers to feel safe when they use our vehicles. under my leadership, i would like to reaffirm our value of placing safety and quality the highest on our list of priorities, which we have held firmly from the time we have founded. i would also stress to live by a system by which we can ensure we value. third, i would like to discuss how we plan to manage quality- control as we go forward. up to now, any decisions on conducting recalls have been made by the customer quality engineer division at toyota
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motor corporation in japan. this division confirms whether there are technical problems and makes decisions for the necessity of a recall. however, reflecting on the issues today, we lacked the customer first attitude. to make improvements on this we will make the following changes to the recall decision making process. when recall decisions are made, a step will be added in the process to ensure the management will make responsible decisions from the perspective of customer safety first. to do that, we will devise a system in which customers forces around the world will reach our management in a timely manner and also a system in which each region will be able to make a decision as necessary.
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further, we have formed a quality advisory group composed of respected outside experts from north america and around the world to ensure that we do not make misguided decisions. finally, we will invest heavily in quality in the u.s. through the establishment of an incentive for quality excellence -- the introduction of a new position. the product's safety executive and the sharing of more responsibility within the company for product quality decisions, including recalls. even more importantly, i will ensure the members of the management team actually drive the cars and that they check for themselves where the problem lies, as well as its severity. i myself am a trained test driver de as a professional.
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i am able to check the problem in a car and understand how severe the safety concern is in a car. i drove the vehicle in the accelerator pedal recall as well as the prius, comparing the vehicles before and after the remedy. i believe that only by examining the problems on site can we make decisions from the customer perspective. one cannot rely on reports or data in the meeting room. through the measures i have just discussed, and with whatever results we obtained from the investigation we're conducting in cooperation with nhtsa, i intend to further improve on the quality and the principle of putting the customer first. my name is on every car.
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you have my personal commitment that would go to will work vigorously and unceasingly to restore the trust. >> that was toyota president and ceo akio toyoda. nhtsa has said they are seeking a fine of $16.50 million against one iota. toyota has taken a number of important steps to improve customer safety related matters as part of our strength and commitment to quality assurance. these include the appointment of a new quality officer for north america and a greater role for the region in making safety- related decisions. joining us is dave shepardson of
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"detroit news." in that statement, did you hear toyota saying they did know about this problem and did not go forward? >> they are not going that far. they're saying they got too big too fast. remember, toyota is an amazing success story. they went from 10% u.s. market share in 2000 to around 17%. this year, the almost out sold general motors to become the largest retail auto maker in the united states. they built plants over the u.s.. they built a truck plant in texas. they build a plant in mississippi. i think what he is saying is that his company became the world's largest automaker. they did not do enough to keep track of quality. there are other critics who said toyota -- a former u.s. executive said it had been hijacked by financial pirates at
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the company. as they got so big, did they forget the values that made them the company they are today? >> this potential find -- some are saying it is a warning to other automakers. what is the law here that toyota potentially violated? >> one is the safety act which created nhtsa and sets the rules for recall. the second is the tread act, which was passed in 2000 in the wake of the for firestone recalls and accidents. congress is very likely to pass new autos if you legislation sometime this year to fight the fines we are talking about from $16 million to phar-mor, to give more money to, nhtsa to add more auto safety investigators, to potentially require black boxes on vehicles. there is a device called a great shift override which would give drivers a tool to prevent
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runaway vehicles if accelerator pedals got stuck. there is a possibility of changing the paradigm automakers face to a much more aggressive nhtsa that has no reason not to be tough on the companies. you had top members of the senate and house saying that nhtsa failed to do its job and needs to be fixed, according to senator jay rockefeller. i think this is going to change how nhtsa and how the auto executives react. >> we're using eight washington acronym. it is the national highway traffic safety administration. what is its mission? >> it insures that the 300 million vehicles on the nation's roadways are safe. it sets requirements, for example requiring airbags and setting roof strength standards and other powers -- other specifics. secondly, it investigates
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problems with vehicles and ensures that vehicles are being recalled that should be. it sets specific regulatory requirements and conducts recall investigations and requires recalls. that is how they do their job. >> nhtsa is under the transportation department. you saw a statement, up from the transportation secretary. why didn't this come from the nhtsa head? >> he is relatively new. the obama administration's first nominee withdrew in the early months of the administration. they did not have a permanent appointee for nearly a year. he had not done much press. he has only made a couple of speeches. i think he is getting his feet wet. i expect at some point we will see a little more from him. >> what will nhtsa be doing in the days and weeks to come on this issue of toyota and investigations overall? >> where to begin.
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first, they have brought in at nasa and the national academy of sciences to investigate sudden acceleration. the first one is going to take 15 months looking at whether cosmic radiation or other issues could be at issue. the other is to look at the broader issue -- what is the cause of sudden acceleration, not just in toyota but in others? they're going to continue looking at those 70,000 documents and decide whether toyota followed the rules on the other recalls. they are also looking at complaints on the toyota corolla. you have a multitude of investigations. you also see nhtsa being much quicker to investigate other problems. they just opened a preliminary investigation of 6 million gm vehicles for breaking issues. the other thing we have seen at least three times in the last month -- automakers have stopped
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selling vehicles were they did not have a fix, which was very rare before. >> transportation secretary ray lahood talked about the investigation going forward in february before a house committee. we will take a look at that. >> when i talked to mr. toyoda, i said three things. i said this is a very serious matter for your company in america. i want you to know the dot is taking it seriously. we are not going to sleep until every one of your cars is safe for americans to drive. i invited him to come to america. >> we never had a chance to talk, but you have been proactive in trying to get out in front of this. one of the concerns i have is that 70% of this sudden unintended acceleration we still do not have an answer for.
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in fact, according to all the documents from nhtsa and also from toyota only 16% of the sudden accelerations are really addressed with the format and the sticky accelerator, if you will. and the electronics seems to have to have some part of it. are we any further along? >> as i said in my testimony, we are going to do a complete review of the electronics. we will meet with the folks from southern illinois university, take a look at the results of what they have had to look at. we will look at what the toyota folks have done with the people they have hired. we are going to get into this. we're going to get into the weeds on the electronics. we feel an obligation to do that because we have 30,000 complaints a year and we take every one seriously.
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we do not just set them off to the side. when we see a few start to stack up, we get into it. i commit to you we are going to do that. >> how about this event data recorder, which records information 5 seconds before an accident and one after? >> we have a review of that going on. >> it says you're investigators have been asked at some of these accidents sites, like the south lake, texas 1, the one that happened up in auburn, new york -- that one was also nhtsa. folks were there. investigators took the black box on november 27. what did you do with it? what do your investigators do with the black box if you do not have any way to read it? >> our challenge is to investigate these and to render judgment about it.
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>> would your investigators have taken the black box? >> i do not know the specifics on that incident. i will check it out. >> i got that from your outline that you provided us of the actions you took. do you have any knowledge? >> i do not. dr. gilbert indicated he was able to bypass the system and the diagnostic code would not come up. it was a book end -- one of the things that could happen. he said he notified nhtsa of the test results, what he found -- tried to contact nhtsa. all he got back was an e-mail form saying "thank you for contacting us." can you assure us nhtsa is going to follow up? >> you have my 100% commitment that we will talk to anybody
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that wants to talk to us. we will look at studies that have been conducted, studies that have been done through the toyota program. we will figure this out. i know all of you think this is a serious issue. we think it is a serious issue. >> you not stopped building cars in the united states, certain models. are they still building those cars? are they going to pause? what is the status. on building some of their models in the united states, they stopped after your intervention. have they started producing those cars again? >> i do not know. i will have to get back to you on that. >> does nhtsa need the responsibility -- does it need to accept some responsibility? we heard today that they fell nhtsa tried to convince them it was the floor mats.
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is there some responsibility nhtsa shares in this investigation? >> if you look at my testimony, no one has talked more about safety in washington d.c. -- washington, d.c., and around the country, then ray lahood. we had a distracted driving conference. we stepped up on a car mat rule so that people do not have to sit -- stepped up on the tarmac rule so people do not have to sit on airplanes six hours. we suspended air traffic when there was a crash over the hudson. we also investigated when the pilots overflew minneapolis by 150 miles. we are not sitting on our hands. safety is our priority. we take it seriously. we take every complaint seriously. we look at it and we open investigations when we think it needs to be done. >> no one doubts your aggressive
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enforcement action. the problem we have -- if we have all these complaints on sudden surges in his vehicle -- toyota vehicles -- and we get 70% unresolved, how do we resolve that 70% that is still unaccounted for, and explained, with millions of these vehicles on the road? >> we will continue our investigations which we have. there are currently investigations going on. there are recalls going on. many of them were sparked by the department of transportation and nhtsa -- initiated by us. >> but you cannot continue the investigation -- in 2004, you did your report, march 24. you closed it on july 22, 2004. there were five fatal accidents
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involving surges and the investigator said it does not count because we are only looking for a momentary surge and that accelerators stayed on too long. we just disregarded it. it was like they looked at it with blinders on. when we do this investigation we cannot do that. you're doing an investigation. you have five fatal accidents coming in and you do not take them into consideration in your report. that is poor work. >> that will not happen on my watch. >> we are talking about auto safety -- federal oversight. we will incorporate your phone calls and twitter messages. the phone numbers will be up on your screen. you can also go to twitter.com. #cpsspan is our handle.
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first, and dave shepardson of "detroit news" is here to talk about these investigations. before we heard from secretary lahood in february we were talking about the fact that nasa and the national academy of sciences have been asked to step in and investigate as well. why nasa? why the national academy of sciences? >> they are looking at the issue congressman stilupak was talking about with the electronics. there are mechanical issues. the big question is -- is there something about the electronics? is there a glitch or a ghost in the machine causing some of these runaway vehicles? nhtsa and toyota say they have not found any evidence, but
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they're going to assemble a panel of electrical engineers and other electronic experts to get to the bottom of whether there is something in the millions of lines of code and all the electronics in the vehicles that are to blame for some of these incidents. >> what is the evidence saying right now? the strongest evidence in support of electronics is that there are many unexplained incidents. you see many complaints that have not been explained by mechanical issues. the hardest part is human error. some people sometimes hit the wrong pedal. they hit the accelerator instead of the break. we've probably all done it for a second accidentally. people do not want to admit that. if you make a mistake -- we do not know if some of those incidents could be attributed to an electronic issue. there are a lot of trouble in complaints that certainly are from